In light of the recent changes to the General Code of Conduct for Authorised Financial Services Providers and Representatives (“General Code”) in terms of section 15 of the Financial Advisory and Intermediary Services Act 37 of 2002 (“FAIS”), it is required of Financial Services Providers (“FSP’s”) to implement a Conflict of Interest Policy and to ensure controls are in place to manage all conflicts of interests. Click2Sure Intermediaries Proprietary Limited (hereinafter referred as “Click2Sure”) is an authorised FSP with no. 46838 and is required to put such a policy and controls in place.
What is a Conflict of Interest and when may it arise?
A Conflict of Interest means any situation in which a provider or a representative has an actual or potential interest that may, in rendering a financial service to a client, either influence the objective performance of his/ her obligations to that client; or prevent a provider or representative from rendering an unbiased and fair financial service to that client, or from acting in the best interest of that client, including (but not limited to) financial interest, ownership interest or any relationship with a third party.
A conflict of interest may for example arise where a company, or one of its employees, is providing a financial service to its clients and may entail a material risk of damage to that client’s interests, and whether the company or its employee:
Managing of conflicts of interest
There is the potential for a conflict of interest in any activity, relationship or process that Click2Sure may be involved with. Click2Sure shall however for the purpose of managing conflict of interests, deal with conflicts of interests as follow:
Guide to Conflicts of Interest Procedure
If the conflict can be resolved immediately, take the necessary. The on-going status of the conflict is to be recorded in the register. If the conflict requires further clarity and investigation by any other party, insert comments as appropriate in the appropriate register
Examples of Conflicts of Interest
Contracts, proposed contracts and similar transactions or arrangements
A conflict of interest may arise where an employee has a direct or indirect interest in a transaction. This may be where the employee has a connection with the other party to the transaction, or where the employee’s family has a connection. The connection may be from a directorship, significant shareholding, employment or consultancy. Click2Sure requires disclosure of any connection which could, or could be seen to have the effect of compromising the judgment of any of our employees. Employees are required to notify Click2Sure of any such potential conflicts of interest, who will then decide if the employee can be involved in the transaction.
Gifts, Hospitality & Inducements
Inducements, gifts and hospitality are all issues that could lead to potential Conflicts of Interest. All employees must act with the highest standards of integrity to avoid any allegations of Conflicts of Interest. Employees must not accept any cash payments, significant gifts or hospitality. Token gifts may be accepted, providing they have not been solicited, have not been given as a business inducement and will not compromise Click2Sure’s integrity. A register is kept of any gifts, or hospitality received. Employees cannot attend hospitality events, without their line manager’s approval. Where an invitation could be construed as being a business inducement, it must be declined.
Roles and responsibilities
The Board is ultimately responsible to ensure compliance with FAIS as one of the key legislation applicable to its business. Conflicts of interest will become a standing agenda item for Board and Management meetings. Procedures will be drafted and adopted to form part of the compliance documentation as to ensure that Conflicts of Interests are properly addressed within the business.
Key Individual and Legal Advisor
The Conflicts Managers are responsible for the internal oversight function to implement appropriate processes and procedures for the effective risk management of conflicts of interest and other risks arising within Click2Sure. The Conflicts Managers are responsible to implement conflicts management policies, procedures and controls to manage conflicts effectively. The Conflicts Managers are also responsibility for identifying, recording and managing conflicts of interest within the business and will be responsible to advise or train all staff in respect of conflicts of interests, including examples or possible conflicts of interest that may emerge. The Legal Advisor will keep adequate records of the controls management process, from identification through to effective resolution of the conflict.
Compli-Serve, as compliance officer of Click2Sure, is in a position to assist in facilitating the handling of any identified conflict relating to the business of Click2Sure. This may involve assessing and evaluating the conflict with Click2Sure, and decide upon, and implement, an appropriate response to the conflict. Compli-Serve will ensure conflict-monitoring procedures are in place to ensure that any non-compliance with Click2Sure conflicts management arrangements are identified and appropriately acted on.
All employees of Click2Sure are obliged to report actual, perceived or potential conflicts of interest-see procedures above to senior management. The failure of employees to notify management to the potential conflict of interest may result in disciplinary action being taken against the affected individual/s, which may include dismissal if appropriate.
Click2Sure expects all its employees to maintain the highest standards in carrying out their business activities, adhering to legislative requirements and policies on business conduct. It further expects its employees to act professionally, honestly and ethically in all their dealings with clients, colleagues and third parties.
Click2Sure has a clear policy on Conflicts of Interest:
This Policy is adopted by the Click2Sure Board on 08 March 2017
On behalf of the Board of Directors
Click2Sure Intermediaries (Pty) Ltd
08 March 2017
Nicola Husemeyer Botha (Director)